Hero Honda Now Renamed As Hero Moto Corp.


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Hero MotoCorp incorporates subsidiary in Netherlands; to expediate global expansion

In a bid to fast-track its ambitious plan to enter 30 countries, two wheeler maker Hero MotoCorp has incorporated an off-shore investment subsidiary in the Netherlands — the first in a slew of overseas arms it plans to establish. This new subsidiary is the first-ever overseas financial transaction by Hero MotoCorp aimed to catapult its international operations into a major growth driver in the future, according to three informed sources.


"Hero recently got its first 100% subsidiary incorporated in the Netherlands to expedite its global expansion plans, which includes overseas investments and merger and acquisition opportunities. The company may announce this soon," said a senior executive from Hero MotoCorp. The size of the potential investment in the overseas subsidiaries was, however, not available.

The New Delhi-headquartered Hero "is also actively considering opening up a few more overseas companies and offices in Europe, the US and Latin America to facilitate scaling up its international businesses", one of the three persons told ET on condition of anonymity.

Its domestic peers such as Bajaj Auto and TVS Motors are already operating overseas subsidiaries. The Pune-based Bajaj Auto operates PT Bajaj Auto Indonesia that is engaged in production and sales of two-wheelers in South East Asia while Bajaj Auto International Holdings BV, Netherlands, is a wholly-owned subsidiary for the company's key strategic operations. TVS Motors also operates an Amsterdam-based subsidiary TVS Motor Company (Europe) besides a manufacturing entity, PT TVS Motor Company in Indonesia.

As India grows into the top five global automotive markets by volumes, other Indian companies are also expanding to increase penetration to new overseas markets. The country's largest carmaker Maruti Suzuki, owned by Japanese Suzuki Motor Corporation, is also toying with ideas to start assembly operations in several overseas markets as part of its strategy to consolidate exports in key strategic countries. Hero MotorCorp, which parted ways with its erstwhile technology and joint venture partner Honda Motor of Japan, has set up a target to increase exports to around 10% of its total sales in the next few years from the current 2% of its total sale of 6 million units.

"These subsidiaries will play a critical role in expanding Hero's global footprint in these key markets through solo investments, joint ventures and strategic partnerships. As the company goes into new international markets, it may have to set up assembly units and full-fledged manufacturing plants, form joint ventures with local partners and invest in brand building activities," the person told ET on condition of anonymity.

This international initiative is in line with the company's stated objective of reaching a million units in volume sales from its international business by 2016-17, around the time when the overall volume of the company is expected to be around 10 million units, he added. When contacted, the Hero Moto-Corp spokesperson confirmed the recent developments but refused to divulge any details. "We have plans to take brand Hero to global markets. Our plans are in place and we are going ahead as per our own timelines. We would, however, like to talk about these in details at an appropriate time."

Hero MotoCorp incorporates subsidiary in Netherlands; to expediate global expansion - The Economic Times
 
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Hero MotoCorp incorporates subsidiary in Netherlands; to expediate global expansion

In a bid to fast-track its ambitious plan to enter 30 countries, two wheeler maker Hero MotoCorp has incorporated an off-shore investment subsidiary in the Netherlands — the first in a slew of overseas arms it plans to establish. This new subsidiary is the first-ever overseas financial transaction by Hero MotoCorp aimed to catapult its international operations into a major growth driver in the future, according to three informed sources.


"Hero recently got its first 100% subsidiary incorporated in the Netherlands to expedite its global expansion plans, which includes overseas investments and merger and acquisition opportunities. The company may announce this soon," said a senior executive from Hero MotoCorp. The size of the potential investment in the overseas subsidiaries was, however, not available.

The New Delhi-headquartered Hero "is also actively considering opening up a few more overseas companies and offices in Europe, the US and Latin America to facilitate scaling up its international businesses", one of the three persons told ET on condition of anonymity.

Its domestic peers such as Bajaj Auto and TVS Motors are already operating overseas subsidiaries. The Pune-based Bajaj Auto operates PT Bajaj Auto Indonesia that is engaged in production and sales of two-wheelers in South East Asia while Bajaj Auto International Holdings BV, Netherlands, is a wholly-owned subsidiary for the company's key strategic operations. TVS Motors also operates an Amsterdam-based subsidiary TVS Motor Company (Europe) besides a manufacturing entity, PT TVS Motor Company in Indonesia.

As India grows into the top five global automotive markets by volumes, other Indian companies are also expanding to increase penetration to new overseas markets. The country's largest carmaker Maruti Suzuki, owned by Japanese Suzuki Motor Corporation, is also toying with ideas to start assembly operations in several overseas markets as part of its strategy to consolidate exports in key strategic countries. Hero MotorCorp, which parted ways with its erstwhile technology and joint venture partner Honda Motor of Japan, has set up a target to increase exports to around 10% of its total sales in the next few years from the current 2% of its total sale of 6 million units.

"These subsidiaries will play a critical role in expanding Hero's global footprint in these key markets through solo investments, joint ventures and strategic partnerships. As the company goes into new international markets, it may have to set up assembly units and full-fledged manufacturing plants, form joint ventures with local partners and invest in brand building activities," the person told ET on condition of anonymity.

This international initiative is in line with the company's stated objective of reaching a million units in volume sales from its international business by 2016-17, around the time when the overall volume of the company is expected to be around 10 million units, he added. When contacted, the Hero Moto-Corp spokesperson confirmed the recent developments but refused to divulge any details. "We have plans to take brand Hero to global markets. Our plans are in place and we are going ahead as per our own timelines. We would, however, like to talk about these in details at an appropriate time."

Hero MotoCorp incorporates subsidiary in Netherlands; to expediate global expansion - The Economic Times
 
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Hero MotoCorp commences exports to Latin America, Africa

In a bid to achieve its stated objective of exporting a million unit over the next five years, World's largest two wheeler maker, Hero MotoCorp commenced its export operations to Africa, Latin and Central America.

Pawan Munjal, MD & CEO, Hero MotoCorp Ltd, said "We have started despatches to our new international markets in Central and Latin America and Africa. Our first consignments of two-wheelers have already been shipped to Peru in Latin America, El Salvador, Guatemala and Honduras in Central America and to Burkina Faso and Ivory Coast in Africa. We shall also be despatching the first lot of our two-wheelers to Kenya too later this month."

The Hero motorcycles to be sold in these markets include a mix of models from the 100cc and 125cc range. The company has already appointed new distributors and channel partners in all these markets, where retail sales of the Hero two-wheelers is likely to commence in the first quarter of this fiscal.

These initiatives are in keeping with Hero MotoCorp's vision of reaching a total of 10 million unit volumes in a few years' time, and garnering a million units - 10 per cent of that - from international business. To meet this ambitious objective, the company has already short-listed as many as 30 countries across Latin America, Central America, Africa and South East Asia. Colombia is the only country in Latin America where Hero MotoCorp currently exports to.

The other international markets where Hero two-wheelers are sold include Sri Lanka, Bangladesh and Nepal.

Hero MotoCorp commences exports to Latin America, Africa - The Economic Times
 
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Hero MotoCorp announces five-year warranty on all two wheelers

Country's largest two-wheeler maker Hero MotoCorp has announced a warranty of five years on all its models.

The warranty will be of five years or 70,000 km on motorcycles, whichever is earlier and five years or 50,000 km on scooters, whichever is earlier, the company said in a statement.

Hero MotoCorp announces five-year warranty on all two wheelers - The Economic Times
 
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Hero Motocorp offers industry-first 5 year/70,000 km warranty on all its bikes

Hero Motocorp ended its ties with Honda in 2011 but the complete disengagement from Honda would come only in 2014.

As per the agreement, Honda will continue to offer support in the form of technology to Hero until 2014. Hero Motocorp has to cook on its own after that by making use of its in-house R&D capabilities. The technological partnership with America’s Erik Buell Racing is expected to substitute Honda’s role in the company’s operations.

In order to retain the confidence of the customer on Hero’s products even after the withdrawal of Honda’s technology and to cement its leadership position, the world’s largest two wheeler maker (in terms of volume) has increased its warranty to 5 years/70,000km on motorcycles and 5 years/50,000km of scooters. This is the first time in the Indian two wheeler industry that a manufacturer is offering a five year warranty.

The increase in the warranty may not be a reflection of the improvement in the product quality but it just portrays Hero Motocorp’s confidence on its products. Of course, the 5 year warranty is a good thing from a customer’s point of view since it makes the purchase decision risk free.

In comparison, Bajaj Auto offers a warranty of 2 years/30,000km while TVS provides 2 years/40,000km (whichever comes first). The extension of the warranty period would come in handy as a trust-builder when Hero Motocorp brings its new products which are designed and engineered in-house.

Hero Motocorp offers 5 year warranty on all its bikes
 

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Hero MotoCorp felicitates India’s gold-winning hockey team with Rs 2 lakh & ZMR bike

World’s largest two-wheeler manufacturer, Hero MotoCorp, felicitated the Indian National Hockey team for winning the Gold at the 17th Asian Games 2014 at Incheon. As a gesture of appreciation for winning the Gold and thereby qualifying for the Rio Olympics 2016, Hero MotoCorp also rewarded each member of the team with Rs 200,000/- and a 225cc Hero ZMR motorcycle. The company also rewarded each support staff of the team with Rs 100,000/-.

Pawan Munjal, Vice Chairman, Chief Executive Officer & Managing Director, Hero MotoCorp said, “This victory by the hockey team at the Asiad Games will go a long way in our collective efforts to revive our national game. What makes this victory even more special is the fact that the title has returned to India after a long wait of 16 years. Representing India in the global arena is a special honour and millions of Indians look up to these champions. At Hero, we have a long history of association with different sports and Hockey has been one of the priority areas. We will continue to cheer for our team and support the game in various formats through our association with Hockey India and FIH.”

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